NI small businesses increase R&D spending

Northern Ireland’s small businesses have significantly increased their expenditure on research and development (R&D) over the last year, according to the latest figures.

The annual Research and Development (R&D) Expenditure figures were published this morning, and reveal that total expenditure on (R&D) was some £273 million in 2004, representing a rise of £5.3 million, 2%, in real terms, since 2003.

Enterprise Minister Angela Smith said: “Knowledge, skills and innovation capability are key factors in creating economic success. I am delighted that small businesses are recognising this. Their expenditure on R&D has increased by one third, and now accounts for 28% of total business R&D expenditure.

“There has been a 19.8% increase in R&D expenditure in the services sector. This sector is increasingly important in Northern Ireland’s economy and I am delighted to see the recognition of the importance of investing in R&D and innovation within the sector.

“Today’s figures also show that Government is playing its part in making Northern Ireland more innovative, with Government funding of business R&D expenditure up over the year by 20% to £18.9million.”

The Minister also emphasised the importance played by the Higher Education sector: “£136 million (50%) of the total R&D expenditure is accounted for by the Higher Education sector. This commitment by HE and Government must be matched by a continued growth in investment in innovation and R&D by the business sector.”

Total business expenditure on R&D increased by 0.4% in real terms over the year. The 10 biggest spending companies accounted for 43% of the R&D in Northern Ireland in 2004, compared with 46% of expenditure in 2003 and 60% in 2002. Expenditure by small sized firms (less than 50 employees) accounted for both greater expenditure (+ £9m) and a greater proportion of total expenditure in 2004 than in 2003 (28% compared with 22%).

The Minister concluded: “Historically, Northern Ireland’s R&D spend is low relative to the UK, the Republic of Ireland and the European Union. However, these figures give me confidence that the importance of R&D, innovation and creativity is being recognised, and I look forward to working with businesses and academia to build on these figures and make Northern Ireland a truly innovative economy.”

(SP/MB)